Say Ahhh!

By Mike Odeh (Children Now) and Kristen Golden Testa (The Children's Partnership) with the 100% Campaign 

And we're off! Implementation of the Affordable Care Act (ACA) is officially underway! Less than six months after Congress passed the ACA, California has blazed the trail as the first state in the nation to create a statewide Health Insurance Exchange under the Act. Two complementary pieces of legislation create the California Health Benefit Exchange and are headed to Governor Schwarzenegger's desk for an expected signature - (AB 1602 creates the Exchange and SB 900 creates a decision-making board).

By creating the Exchange, the State has built a framework that will dramatically improve the way many Californians, particularly the uninsured, get health coverage and will set the right trajectory for health reform implementation by providing new affordable coverage opportunities for millions of children and their families!

Make no mistake - creating the Exchange was no easy task. The legislation that created the California Health Benefit Exchange only came about (on party-line votes) through strong legislative and gubernatorial leadership, thoughtful and dedicated staff, and the efforts of a broad coalition of health and consumer advocates. Certain insurers (ones that are apparently afraid of transparency and a little competition) worked throughout the process to water down the legislation and tried desperately to kill the bill in the final hours. Thankfully, other insurers were supportive and engaged earnestly in negotiating amendments.

CCF's recent blog and issue brief on Health Insurance Exchanges lays out some of the primary responsibilities of an Exchange and identifies some opportunities within the broader federal framework to coordinate among the Exchange and existing programs, like Medicaid and CHIP.

So, as many of you probably know, the ACA allows states to make some important choices, not least of which is the decision whether or not to create a state Exchange in the first place. Given that California is home to nearly 1.5 million uninsured children,  the infamous 39% premium increase proposal and a seemingly infinite state budget stalemate, we really need a custom-designed Exchange that will work for California. Alan Weil and Jon Kingsdale cautioned the California Legislature that making an Exchange work by 2014 would require a lot of strategic planning, thoughtful coordination and time. It's a good thing the Legislature was listening and has been able to take the first step forward for California.

Although the authorizing Exchange legislation creates a governance structure and outlines a framework for the core responsibilities of the Exchange in California, some of the details of coverage in the Exchange, such as the benefit design for the child-only insurance products, will be determined by the governing Exchange Board along with future federal guidance. That's why we believed it was very important that the Exchange be run by a qualified Board with expertise and the authority to negotiate health plan contracts based on price and value while not having conflicting financial interests.  The board also needs representation from those that recognize the importance of coordinating with existing health care programs, systems, agencies, and regulators, so that children are protected and don't fall through the cracks and lose health coverage unnecessarily. Along with minimum benefit standards and cost-sharing limits in the federal law, we believe these factors are critical to ensuring that the coverage offered in the California Exchange is much more meaningful and more affordable than coverage today.

In fact, one of the key features is that the five-member appointed Board is authorized to be an "active purchaser" and will select health plans to participate in the Exchange through a competitive bidding process. Because Exchange board members will be required to have experience with health coverage, administration, and financing, they will be qualified and savvy in negotiating contracts with health plans based on price and value for an estimated 8.3 million lives (including 3.8 million small-business owners and employees and their dependents). 

The legislation also lays out the overall duties and responsibilities of the Exchange, many of which are explicitly required in the federal law (e.g., operating a toll-free telephone hotline and website with comparative plan information) and some of which just make good sense (e.g., authorizing the Exchange board to maximally collaborate with existing health agencies and applying the same standards for insurers and health plans inside and outside the Exchange). It also will allow California to be one of the first states to apply for the federal planning grants that can be used to establish the Board, promulgate strong consumer protections regulations, and develop a process to coordinate effectively with existing state health insurance programs like Medi-Cal (Medicaid) and Healthy Families (California's CHIP).

Since the federal law builds upon (and protects) Medi-Cal and Healthy Families, it is critically important that the Exchange coordinate with existing state and local programs as much as possible. The Children's Partnership and the Kaiser Commission on Medicaid and the Uninsured point out in a recent issue brief that the ACA requires enrollment systems that are consumer-friendly, coordinated, simplified, and technology-enabled. But getting into the "nuts and bolts" of creating enrollment systems that will effectively talk to one another and be easy for families to use requires thoughtful planning and sufficient lead time. That is why we continue to recommend that, as the Board develops the enrollment system for the Exchange and its subsidies, the State buckle down now and start planning for the streamlining and coordination of the other enrollment systems, like Medi-Cal and Healthy Families.

The hard work is just beginning! The 100% Campaign and our partners will continue to advocate (administratively) for better and more program coordination among the Exchange and other programs - not just at enrollment but also during renewal (something we didn't get in the final bill) and at transitions (included in the bill but could still be strengthened). Coordination is especially important when families will be split across programs, for example, when a parent is covered through the Exchange while their child is enrolled in Healthy Families. We will be laying out detailed recommendations for the Board on seamless enrollment, renewal and transition coordination and protections to ensure that only the minimum necessary information is collected from families to determine eligibility for coverage.

While we pushed to get the state Exchange law as strong as possible, we recognize that many detailed decisions of the Board will be determined by federal guidance. That's why we are sharing our thoughts and concerns with the Office of Consumer Information and Insurance Oversight about how the Exchange should coordinate with other programs, and urge them to provide helpful regulatory guidance on the issue. Like stakeholders in other states, we are weighing-in as the federal government develops these guidelines, rules, and regulations, but here in California we are in the unique position of simultaneously sailing ahead into uncharted waters.

So we can't wait passively for guidance to be issued and instead need to focus like a laser on ensuring that we get clear federal guidance that will address such critical issues such as children's benefit design, access to databases for existing eligibility information, and assurances of a coordinated and streamlined enrollment system.

Furthermore, as part of our effort to ensure that families know about and actually enroll in available coverage, we continue to recommend a preferential role for experienced community-based organizations as navigators. Based on our experience here, health care advocates in other states should be prepared for attempts to narrow the navigator role to licensed brokers/agents.

In the end, our State did not develop a perfect bill - the 100% Campaign and our partners had hoped for greater public/consumer representation on the Exchange board, stronger conflict-of-interest prohibitions, more comprehensive coordination requirements, and a preferential navigator role for experienced local community-based organizations. Yet, we are pleased to have a strong starting point and hope to make improvements in the months and years ahead. The new legislation helps structure the incredible amount of work that will be needed to turn the concept of an "Exchange" into an actual gateway to affordable coverage for millions of Californian kids and their families when 2014 rolls around.

Editor's Note: The views expressed by Guest Bloggers do not necessarily reflect the views of the Center for Children and Families.

It used to be that late August in Washington, D.C. was the perfect time to clean the junk out of your office, delete old emails, and go to the dentist. Now, though, the high energy folks in the Obama Administration charged with implementing health reform are bringing yet more change to Washington, D.C..  Yesterday, they sponsored an all-day listening session with stakeholders to gather thoughts and insights on the new Exchanges that are so central to health reform.  They brought together employers, labor leaders, consumer advocates, insurers, and a host of other experts to cover exchange issues such as how to communicate with consumers; small businesses and exchanges; governance issues; promoting delivery system reform; and the role of exchanges in determining eligibility for premium and cost-sharing subsidies and coordinating with Medicaid.

The discussion was incredibly rich, but one theme that emerged over the course of the day - and that also was very much in keeping with HHS's vision for the meeting - is the importance of securing consumer input into health reform implementation and using a transparent decision-making process.  Glen Schor with the Massachusetts' Connector was particularly eloquent on this point, calling transparency a "hallmark" of how Massachusetts has succeeded in implementing health reform.  He and others noted it can be time consuming and cumbersome to solicit consumer input and to share all sorts of details about policymaking, but it is ultimately vital to helping people feel comfortable with major changes.

From a consumer perspective, there also was a fascinating discussion about the kinds of information that people will need to make decisions about their health care coverage under reform.  Of particular note, I thought, were comments by DeAnn Friedholm of Consumers Union about the importance of recognizing that people make decisions in different ways.  Drawing on Consumers Union's experience with publishing Consumer Reports, she pointed out that not everyone is likely to want a detailed chart comparing a health plan along a zillion different dimensions.  Instead, some people may want a much simpler set of information, such as three good health plan options from which they can choose.   While I personally am a huge fan of multi-dimensional charts and love a good spreadsheet, I'm guessing that much of America will want dramatically simplified information about how to secure coverage and enroll in subsidies.

I participated in a panel headed by Director of the Center for Medicaid and State Operations Cindy Mann on coordinating Medicaid and Exchange coverage.  Many of the ideas will be deeply familiar to long-time Medicaid and CHIP experts and advocates, including the need for unified and simplified application and retention procedures for Medicaid and the Exchange; the importance of building a strong information technology infrastructure for eligibility determinations that allows linkages between the Exchanges, Medicaid and CHIP and databases that can be used to verify eligibility; and the value of providing people with multiple ways to apply for (renew) coverage, such as the option to submit applications on-line and/or to secure help from a community-based organization.  At the same time, we discussed that the tax credits for premium assistance and cost-sharing subsidies pose some unprecedented challenges, including that the tax system is based on annualized income and is not designed to respond when incomes fluctuate over the course of a year. 

As intended, the day raised more questions than answers, but, all-in-all, was much better than a trip to the dentist.  Seriously, it was impressive to the extent to which people are beginning to roll up their sleeves and work on turning the health reform law into a practical reality.

Health care "exchanges" are critical to fulfilling the promise of the Affordable Care Act and how states decide to meet their responsibility to establish them will have an enormous impact on children and families.  Today, the Department of Health and Human Services is hosting a stakeholder conference to discuss exchanges. To coincide with the conference, my colleagues, Dawn Horner and Sabrina Corlette, released an issue brief that takes a deeper look at exchanges and what's at stake for children and families. 

HHS's day-long conference is intended to engage stakeholders on the important policy decisions surrounding the establishment and operation of exchanges.  CCF's Jocelyn Guyer will take part in a panel discussion and Dawn Horner will attend the conference. (You can view the conference via be webcast here.)

We'll hear more from them about the conference tomorrow, so let's get back to the issue brief.  "Health Exchanges: New Coverage Options for Children and Families" provides a comprehensive overview of exchanges and key questions policymakers must consider when establishing exchanges.  It outlines the funding and design decisions the states will have to make fairly quickly and points out the broad responsibilities exchanges will have in ensuring that consumers can make informed health care coverage choices.  

For example, the Affordable Care Act requires plans to offer child-only policies (reflecting the importance policymakers placed on the need to ensure that children could secure coverage even if their parents were ineligible for an exchange plan).  Beyond the essential benefits packages, exchange plans must provide children with a comprehensive package of preventive care services (referred to as Bright Futures), including immunizations, well-child visits, vision and hearing tests, health and behavioral assessments, and developmental screenings, with no cost-sharing.  These federal standards are only a floor and states can require plans to cover services for adults and children that are not in the minimum package.  In fact, a number of states already have policies mandating that plans cover specific services, some of them critical to children. (Sixteen states and the District of Columbia mandate that insurers offer at least some level of services for autism.)

Another issue that could impact many families is how well states meet the "no wrong door" policy established by the new law.  It is vital that exchanges coordinate closely with Medicaid and CHIP because many people will move back and forth between subsidized exchange coverage and public program eligibility as their income fluctuates.  The brief points out that states should consider ensuring that some plans offered in the exchange also serve Medicaid and CHIP beneficiaries, creating overlapping provider networks and requiring plans to help facilitate transitions for those in the middle of treatment.

The brief also covers the importance of dynamic technology applications to the success of the exchanges.  The exchange procedures envisioned under the ACA rely heavily on the application of smart technology systems. States should consider setting up a working group now to begin to build these systems. As a first step, a state can pave the way toward electronic interfaces by implementing the proven Medicaid and CHIP automated linkage with the Social Security Administration allowed under CHIPRA to verify citizenship status.

These are but a few of the insights included in the issue brief.  I hope you'll take the time to read it for yourself and share it with others in your state.  We would also love to hear from you on how your state is approaching the establishment of its exchange.

After two weeks in New Hampshire and Maine and a few extra cups of coffee to get moving, I returned from vacation yesterday to find this very interesting development in my inbox - the nation's Medicaid directors are breaking away from the American Public Human Services Association to start their own independent organization - the National Association of Medicaid Directors.  In explaining why they are making the change, the new President of NAMD, Carol Steckel of Alabama Medicaid, explained "Healthcare reform is dramatically changing the face of Medicaid in all of our states and with those changes brings the need for a change to an organization specifically focused on Medicaid and its Directors."

Since I got myself in serious trouble over vacation by expressing an opinion on a family member's new boyfriend, I'm officially out of the business of offering my thoughts on anyone else's relationships, including that of the nation's Medicaid Directors with APHSA.  So, leaving aside whether the split was a good idea or not, I do think it is clear that Medicaid is entering a new era.  As a companion program created alongside Medicare in 1965, it long has been a cornerstone of the nation's health care system, especially for low-income children and families.  And, now it is destined for even greater things in the months and years ahead as we move toward broader health reform. 

The success of both organizations and close collaboration between them will be vital to fostering the critical connections between health care and other social services programs needed to improve the lives of America's families.

On August 10th, President Obama signed an extension of the state fiscal relief first authorized under ARRA. Under the extension, states will continue to receive a phased-out increase in their federal Medicaid matching rate through June of 2011, as opposed to it expiring at the end of this year.

CMS released guidance on the FMAP extension, clarifying that all the maintenance of effort requirements that applied to states under ARRA continue under the extension.

There was one change, however, to the manner in which states request and receive funds. Under the extension, as a condition of receiving the additional federal Medicaid funds, the Governor must submit a request within 45 days of enactment, or by September 24, 2010.